MB Docket No. 14-57 | Citizens Against Government Waste

MB Docket No. 14-57

Letters to Officials

The Honorable Thomas Wheeler, Chairman

The Honorable Mignon Clyburn, Commissioner

The Honorable Ajit Pai, Commissioner

The Honorable Jessica Rosenworcel, Commissioner

The Honorable Michael O’Rielly, Commissioner

Federal Communications Commission
525 12th Street, SW
Washington, D.C.  20005

Re:  In the matter of Applications of Comcast Corp. Time Warner Cable, Inc., Charter Communications, Inc., and SPINCO to Assign and Transfer Control of FCC Licenses and other Authorizations

MB Docket No. 14-57

Dear Chairman Wheeler, and Commissioners Clyburn, Pai, Rosenworcel, and O’Rielly:

On behalf of the more than 1.2 million members and supporters of Citizens Against Government Waste, I offer the following comments in general support for the pending applications of Comcast Corporation, Time Warner Cable, Inc., Charter Communications, Inc. and SPINCO (MB Docket No. 14-57).

On April 4, 2014, Comcast Corporation and Time Warner Cable, Inc. filed with the Federal Communications Commission (FCC) their intent that the two companies would merge following approval by the FCC and the Department of Justice.  In addition, on April 28, 2014, Comcast and Charter Communications announced that following the approval of this proposed transaction, Comcast would divest 3.9 million television subscribers to Charter Communications, which would reduce Comcast’s post-transaction residential customer base total to less than 30 percent of the total number of multichannel video programming distributors (MVPD).[1] 

The Comcast/Time Warner Cable transaction stands to bring consumers appreciable benefits such as faster Internet service, more video programming options, and, potentially, a check on increasing prices.  I encourage you to consider the benefits that such a merger will bring to consumers, including the potential expansion of Comcast’s popular Internet Essentials program, which provides low-cost broadband Internet to families that could not otherwise afford to access the Internet.

These companies do not currently operate in the same geographical markets; and therefore consumers will face no loss of competitive choice for the video, telephone, or Internet  services they offer.  The proposed transaction therefore poses no harm to consumers or any worrisome accumulation of market power.  Critics worrying about either a lack of competition or one company becoming too large should be reminded that there are many competitors in these markets.  For example, Google is expanding its fiber optic network to 34 new markets, while AT&T and Verizon have introduced fiber optic cable and Internet services to other markets.  As a result of the increasingly competitive market, 98 percent of Americans can choose from three or more multichannel video programming distributors today.[2]  No one can predict what the market will look like in the next decade, but it is likely to remain extremely competitive. 

If the FCC limits its review of the transaction solely to its impact on the cable or pay TV industry, it would be mischaracterizing the video marketplace.  National online content competitors such as Amazon, Hulu, Netflix and YouTube are expanding their footprint, aided in part by their significantly lower overhead costs.  A host of others including iTunes, Roku, and Vudu video streaming have also entered this space.  The FCC has already noted the “tremendous growth” in online video, for which revenues have tripled in the last three years.[3]  Government should encourage, not hinder such competition and investment.

Post-transaction, Comcast will have less than 30 percent of the pay TV market.  The federal courts have twice said that the FCC’s previously imposed limit of a 30 percent market share for any single pay TV provider was unjustified; yet Comcast will nonetheless have a share lower than that figure. 

The proposed transaction poses no loss of competition; instead, it promises improvements to consumer choice, service quality, and options.  The record shows a strong, well-functioning, and fluid market with many large and successful firms actively competing for customers.  CAGW encourages the FCC to approve the proposed merger.

Sincerely,

 

Thomas A. Schatz

President

 

 

 

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